Identity Fraud Down 28% in 2010
The number of identity fraud victims in 2010 dropped by 28% to 8.1 million U.S. adults—the largest single-year decrease since 2003. And the total amount stolen decreased to $37 billion—the smallest amount in eight years. However, consumer out-of-pocket expenses rose significantly—63%, says a new study.
The survey, produced by Javelin Strategy & Research, San Francisco, is the nation's longest-running study of identity fraud; it was based on 5,004 telephone interviews. The study, reported by the Credit Union National Association's News Now, defines identity fraud as unauthorized use of another person's personal information to achieve illicit financial gain.
The 8.1 million fraud victims were three million fewer than in 2009, and the total amount stolen decreased from $56 billion in 2009 to $37 billion. Consumers' costs rose significantly due to the types of fraud that were successfully perpetrated and an increase in "friendly fraud," according to Javelin.
"Identity fraud underwent a marked decline and shift over the past year. This great news is a testament to the significant efforts businesses, the financial services industry, and government agencies are making to educate consumers, protect data, and prevent and resolve identity fraud," says James Van Dyke, Javelin's president and founder. "Economic conditions also appear to have contributed to this year-over-year decline, as well as increased security measures and some significant law enforcement successes."
Van Dyke notes the increase in out-of-pocket costs "carries a warning: Consumers cannot put their finances on autopilot or ignore important safeguards. Simple safeguards may dramatically reduce fraud risk, such as frequently monitoring banking, credit, and other financial activities, securing computers and paper records, and activating electronic alerts to help prevent fraud and address the situation quickly when it occurs."
Among other findings:
The amount of fraud almost perfectly inversely mirrored retail sales over the past seven years. When retail sales increase, fraud has decreased. According to Javelin, that points to economic hardships as an overall contributor to fraudsters committing an identity crime.
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